Private financing of rolling stock Developments in Europe

Munich, May 2019 Contents Page

A. Objectives, procedure and scope 3

B. Key findings 7

C. Results by region and segment 16 1. Western Europe 17 2. Eastern Europe 25

© Roland Berger Private Financing of Rolling Stock. May 2019 2 A. Objectives, procedure and scope

Private Financing of Rolling Stock. May 2019 3 The aim of the study was to assess the importance of private financing for new rolling stock projects in Europe

Setup of the study Objectives Procedure

> Determine absolute and relative < > Analysis of ≈ 590 rolling stock projects (new vehicles) in the years importance of private financing for 2015 to 2017 in 23 countries rolling stock projects, focusing on > As in the last two studies1), the methodology has been kept constant – Different product categories (VHS/High Speed Trains, Multiple Units, Urban > Projects were classified as publicly or privately financed depending on the Systems, Locomotives and ownership structure of the procuring entity Coaches/Freight wagons) – All purchases from state-owned entities were considered as being publicly financed – Aggregated Eastern/Western European due to government funding and explicit or implicit state guarantees markets and major submarkets including – If specific project-based funding information was available and revealed private , , , , Poland, financing portions, this was taken into account pro rata even if the procuring entity and the United Kingdom was publicly held – Joint ventures were considered private to the extent of the private party's share in the joint venture – Procurements made by privately held entities were considered as privately financed - even if the operator purchased the rolling stock for a PSO-contract - regardless of whether the purchase is financed by debt or equity

1) Private financing of rolling stock, March 2017 and January 2016

Private Financing of Rolling Stock. May 2019 4 All projects were assigned according to the product categories used in the UNIFE World Rail Market Study

Scope – Product categories VHS/High > Very High Speed Trains (≥300 kph) Speed > High Speed Trains (220–299 kph)

Multiple > DMUs (≤160 kph) > EMUs (≤160 kph) Units > DMUs (161–219 kph) > EMUs (161–219 kph)

Urban > Light Rail Vehicles Systems > Metro Vehicles > Automated Systems Locomotives > Electric Locomotives > Diesel Locomotives > Shunters Coaches/ > Single-deck Coaches Freight wagons > Double-deck Coaches > Wagons (Freight)

Source: UNIFE World Rail Market Study 2018 Private Financing of Rolling Stock. May 2019 5 The analysis was based on a project database covering all significant European rolling stock markets

Geographical scope and market overview by product category

> The scope of this study is rolling stock order intake in Europe with an average annual market volume of EUR 14.95 bn in the years 2015-17 > Of the ≈ 590 projects analyzed from a customer's perspective, 149 (25%) were in Germany, 81 (14%) in France, 58 (10%) in Poland, 45 Finland (8%) in Italy, 40 (7%) in the United Kingdom and 34 (6%) in Switzerland > Average market volume per project was approximately EUR 75 m

Netherlands Denmark Average annual total market volume by product category, 2015-171) Poland [EUR bn, p.a.] UK Germany Belgium Europe Total GER GBR FRA ITA SUI Others 14.95

Switzerland Austria Multiple Units 7.86 France Romania Serbia Urban Systems 2.92 Bulgaria Italy Coaches/Wagons 1.67 Spain Turkey Locomotives 1.31 Portugal Greece VHS/High Speed 1.19 Covered by project based analysis Covered by extrapolation 1) Yearly average of order income from 2015 through 2017

Source: UNIFE World Rail Market Study 2018, Roland Berger analysis Private Financing of Rolling Stock. May 2019 6 B. Key findings

Private Financing of Rolling Stock. May 2019 7 Private financing covers 23% of European rolling stock order volume

Overall results for private financing shares (2015-17)1)

By volume [EUR m, p.a.] By projects [#] General insights > Private financing accounts for about 23% (EUR 3.40 bn) of total average annual market volume2) 3,403 > 42% of all projects are backed by private financing, either fully (23%) 250 or partially in joint ventures (42%) 340 > Private funding is considered important with regard to volume for 11,552 (58%) the purchase of Coaches and Freight cars (54%), Locomotives (77%) (46%) and VHS/High Speed Trains (40%) > In terms of absolute private financing, Multiple Units (EUR 1.42 bn, p.a.) are the most important product category By volume and region [EUR m, p.a.] Regional insights > In Western Europe, all product categories rely on private Western Europe 10,431 3,117 23% financing; throughout Eastern Europe, Urban Systems are entirely financed by public entities > Private financing is comparatively important in Slovakia (62%), Eastern Europe 286 20% the United Kingdom (58%) and the Czech Republic (43%); higher private shares only appear based on a relatively small 1,121 number of projects in countries like Greece and Portugal Private finance Public finance 1) Yearly average of order income from 2015 through 2017 2) If leasing from public entities to private operators is regarded as private financing, the share amounts to 26%

Private Financing of Rolling Stock. May 2019 8 The share of private financing in rolling stock purchases increased steadily since 2011-13 both in absolute and percentage terms

Overall results compared to the previous studies

Development of volume [EUR m, p.a.]1) Trend insights Total [EUR m, p.a.] 23% > Total annual investment volume in Europe, which fell slightly from EUR 13.33 bn in 2011-13 to EUR 12.12 bn 19% 17.989 13% 3,403 in 2013-15, has increased to EUR 14.95 bn 1,670 20% > Since 2011-13, the annual volume of private financing has steadily increased by EUR 1.73 bn, 2,461 representing 23% of total investment in the most recent study > The overall increase of private financing volume was mostly due to further growth in the Locomotives and Coaches/Freight wagons sector; private funding has also risen in the High Speed Trains subsector 81% 77.959 11,659 11,552 9,656 > The slight decrease in public financing was caused by lower VHS/High Speed investments by publicly held entities over the period under consideration > The share of projects involving private financing has risen considerably from 18% to 42% over the observation period which is mainly due to an increasing number of Locomotives, Coaches/Freight wagons and 2011-13 2013-15 2015-17 VHS/High Speed projects ∑ 2011-17 Private finance Public finance > Total private financing volume for 2011-17 amounts to 1) Yearly average of order income from 2015 through 2017 EUR 18 bn

Private Financing of Rolling Stock. May 2019 9 Private financing has become more important for Locomotives, Coaches/Freight wagons and High Speed trains

Key findings per product category compared to previous studies

Share of private financing by volume [%] Trend insights by product category > The rise in private financing in the VHS/High Speed sector is 55 Coaches/ mainly due to increased private funding in High Speed projects in the UK and Italy, while funding for other VHS projects remains 50 Freight cars mainly public Locomotives 45 > In the UK, private railway companies like First Group operate HS 40 VHS/High lines such as FTPE; the predominantly privately financed company Speed NTV operates HS projects throughout Italy 35 > For EMUs, private financing remained stable compared to the 30 last study, but decreasing absolute volumes of DMU private financing led to a lower share of private financing in Multiple Units 25 > Urban Systems remain almost exclusively publicly financed 20 Multiple Units > While total investment volume for Diesel Locomotives has 15 decreased in the past years, private financing for Electric Locomotives and Shunters has grown, leading to a 15 pp 10 increase 5 > Increasing private funding for Single-deck Coaches and Urban Systems Freight cars led to an overall growth by 23 pp, while most Double- 0 deck Coaches were publicly financed 2011-13 2013-15 2015-17

Private Financing of Rolling Stock. May 2019 10 Private financing was widely used for Multiple Units, Locomotives, HS and Wagons while Urban Systems and VHS rely on public funds

Key findings per product category [2015-17] VHS/High > The subcategory of Very High Speed Trains is generally dominated by state- Speed owned operators such as state railways (private financing volume share 3%) > High Speed Trains are increasingly financed by private entities (68% of volume)

Multiple > With 42% of total private ROS financing, Multiple Units remain the most important Units category of private investments in rolling stock (in absolute terms) > 40 entirely or partially privately financed projects were ordered

Urban > As most local transport networks are operated by public authorities or enterprises, Systems private financing plays a minor role in Urban Systems (<1%) > In the research period, 5 projects with private financing have been considered

Locomotives > 46% of locomotive investment volume is covered by private financing, indicating the high importance of private financing in this segment > 122 (out of 171) projects with shares of private financing were ordered

Coaches/ > Private financing is well established in the Wagon, but to a lesser extent in the Wagons Coaches, segment > A total of 74 partially or fully privately financed projects have been identified

Private Financing of Rolling Stock. May 2019 11 Liberalization of market segments and importance of private finan- cing tend to correlate positively – HS is an exception in this study

Market liberalization and private financing – Per segment

Market segments with a high degree of More regulated market segments liberalization usually tend to have a usually tend to exhibit lower shares higher private financing proportion [%] of private financing – HS is exception in this edition of study [%] 18% Multiple Units 3% Very High Speed > Share of private funding of Multiple Units ope- > Due to market dominance of state-owned rating in gradually liberalized regional transport rail companies, private financing remains has increased, strengthening its position as low most important market for private financing 68% High Speed 46% Locomotives > Despite regulations, the share of private financing accounted for about two thirds of > Locomotives are mostly used in freight traffic, total High Speed investments, caused by

which has been liberalized across Europe value high major projects in Italy and the UK; in other Exceptionally parts of Europe the share remains at a low level (3%) 54% Coaches/Freight cars Urban Systems > Greater share of private funding of 0% freight wagons is a consequence of > Publicly owned transportation companies liberalized freight traffic conduct almost all projects without private funding

Private Financing of Rolling Stock. May 2019 12 When analyzed by country, a similar positive correlation between liberalization and private financing volume is apparent

Market liberalization and private financing – In major markets

2017 Liberalization index1) & private financing share Trend insights

> The United Kingdom rail market was one of the first to be United 99% liberalized in 1994, resulting in a high liberalization index (99%) Kingdom 58% and private financing share (58%) > German markets are moderately liberalized, reinforced by a 32% 19% private financing share Germany 19% > While Poland's share of private financing accounts for 18%, the country has a comparably high liberalization index; this is due to 65% the fact that different regional companies operate the passenger Poland transport, but most contracts are directly awarded to rail operators 18%

owned by the voivodeships/provinces Outlier > With relatively low competition in the passenger market, Italy has a 1% Italy low liberalization index score and a 16% private financing 16% share > The passenger rail market in France remains non-liberalized while 5% the freight market has a small non-incumbent market share; private France 7% financing share and liberalization index are at a low level

Private financing by volume 2015-17 2017 Liberalization index 1) Combined index of passenger and freight market

Source: IRG-Rail Market Monitoring Report, Roland Berger Private Financing of Rolling Stock. May 2019 13 Based on further liberalization and more attractive conditions for leasing/debt, we expect further growth of private financing

Expected development

Private funding can Private financing is Leasing is becoming Rail markets will be balance scarcity of becoming more more attractive for 1 further liberalized 2 public funds 3 attractive to creditors 4 ROS operators 4th railway package Limited public budgets Luxembourg rail protocol Beneficial financing conditions

> Market liberalization of > Budgeting problems of the > The protocol lays the > Growing passenger and freight domestic rail passenger public sector in some foundation for a growing demand encourages operators services is an essential part of European countries lead to share of privately financed to order new ROS; leasing the market pillar of the increased private funding of projects and reduces companies, mostly privately dependence on public budgets financed, offer attractive package rail projects > Global registration of security conditions > Mandatory public tendering > Increasing future interest rates interests, establishing priority > Costs of leasing ROS and limits to direct awards could exacerbate the existing of creditor rights declined due to low borrowing budgeting problems > Opening of network > International legal framework costs and reduced infrastructure and service > Private funding can enlarge to regulate security interests manufacturer prices facilities the pool of funding available > Common identification system > Increased interoperability for enabling monitoring of status and standardization makes it and location of assets easier for leasing companies to market their train pool

Private Financing of Rolling Stock. May 2019 14 Private financing will continue to become more important as a source of financing for rolling stock

Conclusion and outlook > Share of private financing now almost amounts to a By volume [EUR m, p.a.] quarter of rolling stock orders; Private financing 22-31% expected to be an increasingly important source of finance for rolling stock orders 23% Estimate1) > Both the absolute level of procurement and the share 13% 4,000- privately financed will increase further with the adoption 3,403 5,500 of the Luxembourg Rail Protocol 1,670 > Private funding likely to be particularly important for purchase of the following vehicle types: Locomotives, particularly freight transport, Multiple units, Freight cars > Countries with major rail liberalization will continue to be the main markets for private finance (UK, Germany) 12,500- 11,659 11,552 > In order to facilitate private financing as a growth driver: 14,000 – Public authorities, train operators and OEMs should aim at further standardizing vehicles facilitating operating leasing and enabling a wider use across different countries – General conditions need to be improved (legal 2011-13 2015-17 2021-23 framework, stability of government grants, etc.) Private finance Public finance – Liberalization demanded by the EU has to be 1) Based on expert interviews implemented by member states

Private Financing of Rolling Stock. May 2019 15 C. Results by region and segment

Private Financing of Rolling Stock. May 2019 16 C.1 Western Europe

Private Financing of Rolling Stock. May 2019 17 1 Western Europe – Overview Private financing accounts for EUR 3.1 billion of the Western European rolling stock market

Results for private financing shares (2015-17)1)

By volume [EUR m, p.a.] By projects [#] General insights > While private financing accounts for about 23% (EUR 3.12 bn) of total market volume, 43% of all projects in Western Europe are 3,117 related to private financing, either fully or partially (23%) 192 > Private financing has considerable importance for the acquisition of (43%) 254 Coaches and Freight wagons (54%), Locomotives (42%) as well 10,431 (57%) as VHS/High Speed Trains (40%) (77%)

By volume and country [EUR m, p.a.] Country-specific insights > The United Kingdom and Germany represent 69% of the Germany 2,669 614 19% aggregated private financing volume in Western Europe > With an annual private investment volume of EUR 1.55 bn, the 1,552 58% United Kingdom 1,111 United Kingdom represents the country with the highest France 2,299 170 7% absolute private financing > While 31% of analyzed projects in France are either fully or 910 170 16% Italy partially realized by private financing, private funding accounts Others 3,442 611 15% for only 7% of volume share Private finance Public finance 1) Yearly average of order income from 2015 through 2017

Private Financing of Rolling Stock. May 2019 18 1 Western Europe – Overview The volume of private financing in Western Europe has increased in absolute and relative terms since 2011-13

Results compared to previous studies

By volume [EUR m, p.a.]1) Trend insights 23% > Total annual investment volume, which slightly decreased from the 2011-13 to the 2013-15 period, has now increased to EUR 2,449 3,117 13.55 bn in the current time period 13% 797 > A steadily increasing volume of private investment can be -1,370 22% 869 1,452 observed, while public spending has initially fallen and 2,248 subsequently reached a level of EUR 10.43 bn > While private funding accounted for only 13% of total volume in the 2011-13 period, the rise by EUR 1.67 bn results in a 23% private share of total investment volume in the 2015-17 period > Since the first study, the share of private financing has 10,431 9,352 increased in most Western European countries, including the 7,982 United Kingdom (12 pp), Germany (10 pp) and France (5 pp) > Likewise, the number of projects that either partially or fully rely on funding from private entities has grown from 55 (22%) in 2011-13 to 192 (43%) in the 2015-17 period

2011-13 Δ private Δ public 2013-15 Δ private Δ public 2015-17 finance finance finance finance Private finance Public finance 1) Yearly average of order income in the 3-year-periods

Private Financing of Rolling Stock. May 2019 19 2 Western Europe – VHS/High Speed Private financing of VHS/High Speed rolling stock has grown mostly due to High Speed projects in Italy and the United Kingdom

Detailed results VHS/High Speed Trains

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed2)

ERA GBR AT300 Trains 543 fully 473 9 - (40%) SNCF FRA TGV Trains 480 717 (43%) 12 (60%) (57%) Eurostar GBR Velaro Trains 390 partially

RENFE ESP Talgo Avril 337 -

Project insights Trenitalia ITA Trains 255 -

> VHS/High Speed rolling stock comprises the product categories RENFE ESP Talgo Avril 243 - "VHS" (EUR 516 m) and "High Speed Trains" (EUR 674 m) predomi- NTV ITA Pendolino Trains 230 > The Very High Speed sector is only 3% dependent on private nantly financing and is mostly dominated by state-owned rail First Group GBR AT300 Trains 225 fully companies such as SNCF or DB > All major projects that at least partly rely on private financing First Group GBR AT300 Trains 158 fully are located in Italy or the United Kingdom and are assigned predomi- to the High Speed Trains category NTV ITA Pendolino Trains 125 nantly Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 20 3 Western Europe – Multiple Units Multiple Units are the most important category in terms of absolute private financing activities in Western Europe

Detailed results Multiple Units

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed2)

First Group & MTR GBR Aventra Trains 1,020 predomi- 1,407 nantly (19%) 38 (31%) Abellio GBR Aventra Trains 1,000 partially

85 RRX GER EMUs 860 - 6,024 (69%) (81%) NSR NED EMUs 800 -

Project insights SNCF FRA RER E & RER D 782 -

> Multiple Units comprises the product categories "EMUs" SNCF FRA Régio2N 718 - (EUR 6,919 m) and "DMUs" (EUR 513 m) Abellio GBR EMUs 697 partially > With a total share of EUR 1,407 m p.a., Multiple Units are the most important single product category attracting private SNCF FRA Omneo Premium 585 - financing > Large private projects are predominantly occurring in the BLS SUI EMUs 500 partially United Kingdom, where projects are oftentimes financed by consortia of several private companies WMF GBR EMUs 474 fully Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 21 4 Western Europe – Urban Systems Investment in Urban Systems depends to a large extent on publicly financed companies or city governments

Detailed results Urban Systems

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately 5 5 Country Project description EUR m financed (5%) (0%) RATP FRA Metro Line 14 518 -

Wiener Linien AUT Metro 356 -

Metro Brussels BEL City Metro Brussels 353 - 2,390 87 (100%) (95%) VBZ SUI Flexity 2 Zurich 335 -

Project insights Wiener Linien AUT Vienna 4 289 -

> Urban Systems comprise the product categories "Light Rail ATM ITA Milan Metro Line 4 250 - Vehicles" (EUR 1,346 m), "Metro Vehicles" (EUR 1,011 m) and "Automated Systems" (EUR 116 m) MVG GER Inspiro Munich 264 - > Since most local transport networks in Western Europe are BSAG2) GER Avenio Bremen 193 - exclusively operated by public bodies, the share of private Amsterdam financing remains very low NED Tramway Trains 178 - Tramway > All listed major projects were publicly financed BVG GER Flexity Berlin 176 - Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) Classified as publicly financed since >99% are publicly held.

Private Financing of Rolling Stock. May 2019 22 5 Western Europe – Locomotives Private financing accounts for 42% of the investment volume in the Locomotives product category

Detailed results Locomotives

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed

DB Cargo GER 230 - 42 463 (34%) SBB SUI Prima H4 Locomotives 175 - (42%) 640 82 (58%) GER Traxx 3 MS 160 - (66%) TX Logistik Akiem FRA DE18 139 -

ELL Austria AUT Vectron 120 fully Project insights ELL Austria AUT Vectron 120 fully

> Locomotives comprise the product categories "Electric Mercitalia Rail ITA Traxx 3 DC 120 - Locomotives" (EUR 808 m), "Diesel Locomotives" (EUR 81 m) and "Shunters" (EUR 215 m) ÖBB Production AUT Vectron 115 - > Private customers in large Locomotive projects are leasing Mitsui Rail Capital NED Vectron 105 fully companies such as ELL Austria or Mitsui Rail Capital Europe Europe Mitsui Rail Capital NED Vectron 100 fully Europe Private finance Public finance 1) Yearly average of order income in the 3-year-periods

Private Financing of Rolling Stock. May 2019 23 6 Western Europe – Coaches/Freight wagons More than half of the investment volume in the Coaches and Freight wagons category comes from privately held entities

Detailed results Coaches and Freight wagons

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed2) Driving Cars/ SNCB BEL 787 - 28 Coaches 659 (33%) DB GER Double-deck Coaches 282 - 769 (46%) predomi- (54%) 58 Serco Group GBR Caledonian Sleeper 200 (67%) nantly Trenitalia ITA Double-deck Coaches 190 - Transport GBR Coaches 142 fully Scotland Project insights Eurotunnel GBR Lorry-carrying wagons 120 fully Vivalto Option/ > Coaches and Wagons comprises the product categories Trenitalia ITA 98 - "Single-deck Coaches" (EUR 115 m), "Double-deck Coaches Coaches" (EUR 523 m) and "Wagons" (EUR 789 m) VR Group FIN Double-deck Coaches 90 - > The (predominantly) private project with the highest order volume is the Caledonian Sleeper of the Serco Group, which Touax Rail FRA Freight wagons 54 fully accounts for EUR 200 m VR Group FIN Double-deck Coaches 50 - Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 24 C.2 Eastern Europe

Private Financing of Rolling Stock. May 2019 25 1 Eastern Europe – Overview Private financing accounts for about 20% or EUR 286 million of rolling stock orders in Eastern Europe

Results for private financing shares (2015-17)1)

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) General insights > Private financing accounts for about 20% (EUR 286 m) of the total market volume, whereas 40% of all projects are related to 286 private financing, either fully or partially (20%) 58 > Investments in the product categories Multiple Units and Urban (40%) 86 Systems are predominantly financed by public entities 1,121 (60%) > Private financing is important for the acquisition of Locomotives (80%) (67%) as well as for Coaches and Freight wagons (54%) > No significant VHS/High Speed projects were initiated in Eastern Europe in the 2015-17 period By volume and country [EUR m, p.a.] Country-specific insights Poland 334 72 18% > Czech Republic and Poland represent 49% of aggregated Turkey 295 7 2% private financing volume in Eastern Europe Hungary 205 8 4% > With an annual private investment volume of EUR 72 m, Poland represents the country with the highest absolute private Czech Republic 90 69 43% financing in Eastern Europe Others 197 131 40% > In the Czech Republic, 56% of all analyzed projects are either fully or partially covered by private funding, accounting for 43% Private finance Public finance of volume spending in the country 1) Yearly average of order income from 2015 through 2017

Private Financing of Rolling Stock. May 2019 26 1 Eastern Europe – Overview While the total ROS volume in Eastern Europe declined, the private investment volume grew by 11 pp compared to the 2011-13 study

Results compared to previous studies

By volume [EUR m, p.a.]1) Trend insights 9% > Total annual investment volume has declined steadily from 218 -5 EUR 2.53 bn in 2011-13 to EUR 1.41 bn in the 2015-17 period -633 > The relative increase in private financing by 11 percentage points (from 9% to 20%) coincides with an absolute rise in volume 11% (EUR 218 m to EUR 286 m) 213 72 -553 > A considerable relative increase in private spending took place in Poland (10 pp) and Slovakia (57 pp) in comparison to the 2013-15 20% study 286 > While the increase in private spending is mainly due to increased 2,307 investment in Electric Locomotives, the total funding volume has fallen as a result of lower public investments in the Multiple 1,674 Units sector and no investments in VHS/High Speed 1,121 > The number of projects partly or completely financed with private funds grew from 10% to 40% of all projects analyzed during the observed period

2011-13 Δ private Δ public 2013-15 Δ private Δ public 2015-17 finance finance finance finance Private finance Public finance 1) Yearly average of order income in the 3-year-periods

Private Financing of Rolling Stock. May 2019 27 2 Eastern Europe – Multiple Units Private investments only play a minor role in the financing of Multiple Unit projects in Eastern Europe

Detailed results Multiple Units

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed2)

15 2 MAV HUN EMUs 200 - (3%) (6%) MAV HUN EMUs (Flirt) 125 -

TCDD TUR EMUs 116 - 413 30 Małopolska (97%) (94%) POL EMUs 88 - Province GySev HUN EMUs 68 partially Project insights LKA Łódź POL EMUs 58 - Wielkopolska > Multiple Units comprises the product categories "EMUs" (EUR POL EMUs 56 - 403 m) and "DMUs" (EUR 25 m) Province > The majority of projects in this category are financed LKA Łódź POL EMUs 55 - publicly, for example by state-owned joint ventures or state- Koleje POL EMUs 49 - owned railway companies such as those of Poland and Turkey Dolnośląskie Koleje Śląskie POL EMUs (ELF 2) 48 - Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 28 3 Eastern Europe – Urban Systems In Eastern Europe, Urban Systems are completely financed by public entities

Detailed results Urban Systems

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed 0 0 TUR 280 - (0%) (0%) Municipality Istanbul Line TUR 121 - Municipality & M8 Bursa New LRT Burulas TUR 82 - 524 42 Vehicles Istanbul TUR Metro Istanbul 78 - (100%) (100%) Municipality Project insights MPK Poznan POL Trams 74 - Sofiyski BUL Metro Sofia 73 - > Urban Systems comprises the product categories "Light Rail Metropoliten Vehicles" (EUR 328 m) and "Metro Vehicles" (EUR 196 m); no Automated Systems projects were ordered Izmir Municipality TUR Izmir 85 LRV Vehicles 67 - > Since urban transport networks in Eastern Europe are operated BKK HUN Trams 55 - almost exclusively by public bodies, no projects in this study rely on private financing DPMB CZE Trams 43 - > Accordingly, customers in large projects are city Sofiyski governments or their related transportation operators BUL Metro Sofia 37 - Metropoliten Private finance Public finance 1) Yearly average of order income in the 3-year-periods

Private Financing of Rolling Stock. May 2019 29 4 Eastern Europe – Locomotives About two-thirds of the investment volume in the Eastern European Locomotive sector comes from private financing

Detailed results Locomotives

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately 7 Country Project description EUR m financed2) (15%) PKP Cargo POL Vectron 60 predomi- 70 nantly (33%) Budamar SVK Vectron 40 fully 141 Budamar SVK Vectron 40 fully (67%) 40 (85%) Metrans CZE Traxx MS 39 partially

Metrans CZE Traxx MS 37 partially Project insights GySev HUN Vectron 35 partially

> Locomotives comprise the product categories "Electric RegioJet CZE Traxx MS 28 fully Locomotives" (EUR 193 m), "Diesel Locomotives" Rail Capital (EUR 2 m) and "Shunters" (EUR 16 m) POL Gama DC 22 fully Partners > With a 67% share in volume and EUR 141 m p.a., Locomotives are the largest category in terms of absolute and relative CD Cargo CZE Vectron 20 - private financing in Eastern Europe Freightliner POL Dragon Last Mile 18 fully Poland Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 30 5 Eastern Europe – Coaches/Freight wagons More than half of financing volume in the Coaches and Freight wagons sector comes from private entities

Detailed results Coaches and Freight wagons

By volume [EUR m, p.a.]1) By projects [#, total 2015-17]1) Key projects Privately Country Project description EUR m financed2)

MAV HUN Coaches 96 - 6 112 (27%) PKP Intercity POL Coaches 87 - 130 (46%) (54%) 16 Koleje POL Double-deck Coaches 24 - (73%) Mazowieckie ZOS Vrutky SVK Coaches 21 fully

ZUE SA POL Flat Wagons 20 fully Project insights RegioJet CZE Coaches 16 fully

> Coaches and Wagons comprise the product categories "Single- RC Endüstri TUR Wagons 12 fully deck Coaches" (EUR 88 m), "Double-deck Coaches" (EUR 9 m) and "Wagons" (EUR 146 m) ZSSK SVK Coaches 9 - > The largest project is the purchase of 100 coaches by Hungarian State Railways (MAV) with cost of EUR 96 m Raiffeisen Leasing ROU Coaches 7 partially

TCDD TUR Wagons 6 - Private finance Public finance 1) Yearly average of order income in the 3-year-periods 2) "Predominantly" refers to private financing share of >50%; "partially" to ≤50%

Private Financing of Rolling Stock. May 2019 31 www.railworkinggroup.org www.rolandberger.com

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Private Financing of Rolling Stock. May 2019 32